Farming spectrum

Just how competitive is non-standard LTE spectrum‾

It's an issue - the issue even - for those operators planning to re-purpose existing spectrum for LTE.

Like Hong Kong's SmarTone, who pulled out of last month's auction when the price topped HK$450 million ($58 million), saying it saw a better business case in refarming its 1800MHz band.

In Asia's first 4G spectrum allocation, SmarTone's rivals China Mobile, CSL and PCCW-Hutchison paid HK$1.5 billion for spectrum in the standard 2.6GHz range.

CSL's outspoken CEO Tarek Robbiati said he thought spectrum farming was "possible" but not as viable as on the well-backed 2.6GHz range.

Handset and chip manufacturers are not going to customize devices for a small player like SmarTone - but the operator is betting that it's not alone, CTO Steve Chau told telecomasia.net.

Verizon, the US CDMA operator who issued LTE contracts last week, is aiming for a 2010 start in the 700MHz band. NTT DoCoMo, another early starter, hopes to run on 2.1Ghz.

SmarTone is expecting - or betting - that some of Europe's several dozen 3G and 2G operators will also push into LTE in the 1800MHz range, giving some scale for the handset sector to work with.

The other thing working for SmarTone is time. "Take away the teething problems, and LTE wont be ready until 2013, 2014," says Chau.

Meanwhile the industry is about to undergo a sharp rampup in network speeds, with HSPA+ about to come onstream by the end of the year, offering 42Mbps in downloads and, says Chau, a notional 80Mbps by 2010.

"I still have not seen any application that requires more than 7Mbps," says Chau. "Anything beyond 5-10Mbps is simply capacity."

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